Smart Cities, Smart Economies or Nonsense

For most of this century we have tried to be smart. Smart cities and smart economies are terms that have been thrown around to such an extent that there is now little agreement on their meaning.

Yet their underpinning concepts are very important for any business and will significantly affect everyone.

Why Smart is Confused?

In the 2000’s smart cities were a key discussion in urban planning. This led the EU in 2010 to publish its Vision for Europe in 2020. This attempted to tackle Europe-wide structural weaknesses in innovation and productivity through the creation of a ‘smart, sustainable and inclusive economy’. It proposes a social market economy with strong environmental support. But looking at the objectives and measures, none define what smart means, unless it means not stupid?

For others such as the Economist, smart means technology driven inclusive growth. This follows directly on from the Western charge to knowledge-based economies. Here Silicon Valley could be a prime example because of its associated entrepreneurial eco-systems.

Another version of ‘smart’ incorporates the Internet of Things (IoT). IoT combines electronics, software, sensors, actuators and connectivity to enable things to connect, collect and exchange data. Smart does not require human controllers as these will increasingly be taken over by Artificial Intelligence. On this basis the world is becoming increasingly smart.

What is common to these three definitions is a presumption that they occur in urban areas.

Smart Cities

Urban living is increasingly economically important. Half of the world’s population now live in ‘cities’. By 2050 this could grow to over two thirds of the world population. Smart Cities itself is already big business worth in excess of $80Bpa. A smart city has four elements:

Uses data and technology to create efficiencies in supply and demand;

Improves sustainability;

Creates economic development;

Enhances the quality of life for people living and working in a city.

Much of this is IT investments in sensors and apps. These increasingly use common platforms and share data. The growth in smart cities is matched by the growth in smartphones. Indeed it can be seen to exploit this technology eg Hive heating, Uber transport or Tinder. These are based on the desire to save cost or to use something only when needed. Or in the case of the last to be a ‘cultural movement to make every moment count’ by choosing someone on-line geographically close to you.

Competing Smart Visions

While planners may drive smart cities, there are a range of issues in their creation. For example Alphabet’s Sidewalk Labs are working with Quayside in Eastern Toronto to create the ultimate smart city. Their vision is for driverless shuttlebuses, traffic lights that track all mechanical and human flows and modular buildings that can expand and contract over time. But there are issues over data ownership.

An alternative is Santa Maria Tonantzintla, Mexico. Here residents turned their backs on becoming a smart city as it was seen to throw away much of their history.

Smart is important

We live in a world where big data in real time is now usable and decisions can be individualised. Innovation makes much of this possible through its application of knowledge exploited by technology. But smart assumes urban areas as these give it the financial returns on deployment. It relies on interconnections through broadband and mobile.

For rural areas interconnections can be missing, while expectations of similar service can be high. This matters; for example driverless cars rely upon their own and other sensors to work effectively. Some ‘minor’ rural roads could become no-go areas as they lack sensors or the information the car relies on is false. This was and is the case with some GPS systems, where a single track country lane is not the best route for an HGV. Smart therefore could split the Economy into haves and have-nots.

Smart is a significant opportunity. Technology enables remote working and can increase sustainability and quality of life. By challenging accepted patterns such as commuting to workplaces, we can work smarter and increase the positive effects of the smart economy. But only if smart is defined to always include rural and economic innovation. This makes it truly inclusive and sustainable rather than focusing on technological possibilities. This also ensures that the opportunity of Smart is taken and the continuing threat of nonsense avoided for rational business planning.